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Since the VSA II thread now has over 2,200 posts and 128,000 visits, it seemed time to start VSA III. To get us rolling, here is quick VSA look at how the market unfolded this morning on the 3-minute time frame (S&P e-minis). The market opened higher than yesterday’s close, fell off over the first 15 minutes to A, and then tried to rally. B – the rally to B did not bring out demand, and the bars at B were weak, closing on their lows. C – A very weak bar with an increase in spread and volume to the downside. Supply came into the market here. D – No demand on the first rally after weakness appeared and a good short. E – Volume drops off as the market moves lower into the area of yesterday’s close. F – A bottom reversal on good spread indicating demand. G – the market tests the lows of E/F and is unable to draw supply. As it begins to rally, it tests again at G1. H – An increase in volume with a good close, but the spread narrows – caution for longs. J – Down bar, on wide spread and high volume shows supply has reentered the market. J – No Demand followed by a small hidden upthrust. K – Again we come back into the lows and find no supply and the market rallies. T – Tests occur below the resistance at I indicating a rally and a break of I. L – small bottom reversal/key reversal bar which tests for supply by dipping lower one last time before moving up to close on its high. M – Break through the resistance at I and a rally into the noon hour. Note that the volume falls off as we move into the noon hour and come into the morning supply at A. Hope this is helpful, Eiger

Hello folks, I want to start a free chat room for serious traders using Volume Spread Analysis and Wyckoff methods on their day-to-day basis. Im usually online from the middle of London session to the end of NY session (somedays I may be online for the open of the Tokyo session). Details: 1.- No head trader: Nobody giving signals or anything, no guru, just serious traders sharing charts, analysis and talking about Smart Money manipulation. ie: Chat user1: Hey guys seems like GJ its being accumulated after that selling climax Chat user2: Yes, I will be buying any no-supply bar anytime soon 2.- Free of charge: Kinda like the forexstreet chat in the forex socialnetwork but without all the newbies, scammers, signal vendors. I don't like the forexstreet chat personally because it gathers all type of traders with all types of strategies, experience, etc. Because of this, it usually gets a little messy (just my humble opinion, no offense). The idea would be something very similar to this but for VSA and Wyckoff traders only, trading spot forex and/or currency futures on a serious day to day basis. 3.- Non-educational: The motivation of the chat room would not be for educational purposes but I´m a believer that everyday is a learning opportunity and I am always open to learn something from everybody. So, obviously we all will be learning together from each other, but this would not be the main reason of the room. 4.- Real purposes of the chat room: Meet fellow traders using the same methods (Wyckoff and VSA) to make money in the markets, manipulation talk, sharing analysis, basically all the purposes of a trading community but with a filter for Wyckoff method's believers and VSA traders. Important: The chat would be using a private instant messenger like Skype, Hangouts, etc. I don't want to be the "owner", I want the chat open when Im not online so Im open for suggestions from all of you interested. If you use VSA and/or Wyckoff method to trade the currency futures or spot currency markets you are very welcome to join with ideas to make this happen. Please let me know by replying in this thread or via PM Warm regards from Mexico,

I'm going to write daily in this thread my journey using VSA to speculate in the currency markets. My purpose is to get better at this methods (VSA and Wyckoff) and write daily my own interpretation of the (smart money) large operator's moves in currencies. Background about me: Been trading for 5 years (next April), I was trading for the first 4 years using classic technical analysis and supply and demand zones until I discovered the beautiful Wyckoff method and then the vsa method. So basically I am just 8 months using VSA in spot forex. Things I'm looking for in the charts: I am usually looking for the Yao Ming bars, basically I look for climatic action followed by a spring (or upthrust) and then the classic no supply bar (or no demand). I use 1H, 15min and 5 min charts. Everybody is welcome to chime in, just remember that the charts I will be posting are not sell/buy signals, they are just my interpretation of the current story line within the market. Let's begin

I was wondering if anyone had any feedback on this software. I posted here because it appears related to MP and MD and this forum gets a lot of views. http://www.orderflowanalytics.com/Home.aspx http://www.youtube.com/profile?user=OrderFlowAnalytics#g/u It kind of reminds me of Market Delta, but seems a bit different. I had a hard time processing MD when I looked at, at least the footprint. Just too much going on. Just curious if there is any feedback on OFA? Good trading to all, Dan

i am going to discuss about my trading style and strategy in low volume nyse ,nasdaq stocks:crap:

Hi friends, I am Vincent and I have been investing since 1985 and trading full time for the past three and a half years. I have learnt a lot from the various contributors at various websites such as Forex Factory, Traders Laboratory, etc. and am grateful for them sharing their experience so I decided that I am consistent, it will be good to share as well to help those that are still coming to terms with trading. The journey from being a passive investor to an active full time trader has been anything but easy. The psychological aspects cannot be underestimated. This is especially when one reads "you should not risk money that you cannot afford to lose." It's a sort of oxymoron when many retail traders that started had to do so because of age, etc. that made them relatively unemployable and being desperate for a "solution", they believe that trading is IT! The less capital that one starts with, the more the odds are stacked against them because the Catch 22 for them is they need to generate enough profits with as little as possible, that means higher leverage and also higher risks. A few bad trades could wipe out their entire account if they over leverage or have insufficient knowledge of how to trade. Usually BOTH are true when many start out. I used to consistently lose money until I learnt how to understand what was going on in the market. When I was learning trading with the many indicators and systems, it was not that they could not work but simply that they could not work for me for the amount of risk that I was prepared to take (typically my trades utilize a 15 - 20 pip stop loss for the EU and GU pair). Some systems, especially trend trading systems will require stops of 30-70 pips at point of entry, this was simply not feasible for me. It does not mean that these systems could not work but just that I could not bear to see the drawdown because often there will be drawdown and when that happens, many will not be able to take it and hence get relieved when they can get out with 20 pips after risking 50 pips only to see the trade run for 100 pips profit. It also explains why many traders let losers run and cut the winners short. They don't understand the supply/demand dynamics and why the market will retest levels of entry and they end up seeing the trade run away with profits that they could have made. They also fail to see that trading is a reward/risk endeavor where a high reward/risk will more than offset the inevitable losses. Intraday Trading can be really tough just based on indicators. Thanks to the works of Richard Wyckoff, Steve Williams and Chad/Sterling from "Day Trading Forex Live", it finally made sense and I could start piecing the jigsaw together. What was important was to understand the way the markets actually worked and find the tools and methods that work. I have incorporated the principles to develop my own system for intraday trading. I have a free blog called "Trek the Smart Money Trades" that provides a daily review of EURUSD and GBPUSD, with possible Smart Money price action and probable price levels. I have started by posting daily reviews on my blog and maybe later will add some of my trade setups, actual trades, etc. along the way. All tools that I use are freely available on the internet so it will not be difficult to follow me. I look forward to comments and will answer emails as best as I can. This is a free blog, if you find it helpful, my only request is to share/follow/tweet, etc for the google page ranking. This is the Market Analysis posted earlier today: DAILY REVIEW 24 Jul 2013 The daily EU candle is a below normal-spread (75pips) bull just off the high on vol >1days with clear bearish vol divergence. Price has closed above the FOMC spike high 1.3205. With the volume yesterday slightly higher than Mon and the price closing near the high, SM is likely to push higher. Price is close to the daily ema200 at 1.3249, this is a key moving average closely watched by many traders. This is also about the previous breakout retest level on a daily basis that was rejected at 1.3253 therefore even though the price has not reached the daily 1.3390 – 1.3400 supply area yet, this would be a possible area for SM to fade the weak longs to restock their inventory. SM has been creating selling pressure to fade the weak longs since last night which may well mean that they have commenced stocking up to go long later. While my bias is still long, I will be prepared to take profit at the 1.3250 level if price stalls with clear stopruns to the level and take a short back down. On the other hand, if price is able to breakthrough and does it on higher vol with each high, I’ll just hold the trade and look for 1.3290 – 1.3300 which is a previous congestion breakout level. If price actually closes below yesterday’s low during London, I will be looking to short at the retest of the breakout level as SM may go a bit lower before resuming the up move. EU long levels: 1.3184, 1.3163 EU short levels: 1.3250, 1.3305 GU: Daily candle small-spread small-body bullish spinning top (75pips) closed just off the high on vol>1day. Keeping in mind that we had bearish vol divergence yesterday and yet price made a higher high to 1.5390, the narrow body and range reeks of SM intention to sell. With H4 bearish divergence already playing out in Asia with the sell pressure created, if they stall above 1.5325 (yesterday’s low) and push back up, a stoprun/spike through the 1.5400 key level will see me go short as this has the possibility to reach the 1.5280 – 1.5260 level before reversing. If they break yesterday’s low during London, I will look to short at the retest of the breakout. GU long levels: 1.5325, 1.5280, 1.5260 GU short levels: 1.5390, 1.5400 Regards and Good Trading Vincent

Is there a way to show only the High Low and Close on a bar omitting the Opening price of the bar in a similar fashion to those used by VSA traders. Also if you then wanted to paint bars that had a 1st and 2nd Standard deviation wider range than average what tokens would you use for this if this is possible? Thanks

I found a new volume indicator at http://www.tradershelpdesk.com It is really interesting. Surprisingly, I found that the color of the volume bar (buyers versus sellers) wasn’t important – it is really about the height of the volume bars, which is also what Tom Williams says in his book, Master the Markets (you can download the indicator and book free from their website). I hope this will help other volume traders.

Hi Tasuki, A very intresting post I see that you have made. Well it is interesting that you think I can only read the market in hindsight, there are many people at the boot camp that would not agree with you, Eiger was there imputing the trades live, not me, and I called the market up from the start, and then all the way down after 12.00 PM. I even had to explain again for the video. Unless you have concrete proof that I can only read charts in hindsight, I would like to suggest to you that you refrain from this misleading banter. http://www.tradeguider.com/emailshot/bootcamp_2009/vsa_course/index_uk.htm Also, I have been aproached by a Hedge Fund Manager who wishes to engage me as an analyst, this will happen in September, so reading a chart in hindsight is of little value to a professional trader, and this will be the most valuable insight as to how a market is manipulated I can imagine. Regards Sebastian

This thread has come about to enable discussion on the philosophy of VSA away from the VSA threads, which are venues more for application of VSA. Those wanting to question the usefulness of VSA ideas/concepts have done so in the VSA threads, but the questioning has beome so persistent and no resolution appears in sight that this thread has been created to enable that disucssion to continue.

We are all familiar with the great Volume Spread Analysis thread, I thought what I would do here is just highlight some of the information on it, just to make it easier find here rather than on the big thread. Pivot Profiler provided coding for the VSA indicators he used in this post. It is post #1319 on the VSA thread. jjthetrader has researched the logic behind the TradeGuider volume bands and posted the results on this post. He also attached the ELD for his result to this post. Post #51 of the "REQ Help with Trend Indicator" thread. The Master The Markets book is available for download and printing here.

[VSA] Volume Spread Analysis Part II I would like to start a fresh VSA thread due to the increasing length of the original thread. Please use this as a continuation of the first thread located here. PP has also removed the charts from his original thread (EDIT: they have since been re-posted). However, those that have been following the VSA thread should have gained knowledge tremendously. Hopefully we can make this thread as successful as the first one. Here we go. The brilliant game of psychology:

The Basics of Volume Part 1 by Martin Pring Most all the indicators used in technical analysis are based on pricing data. We either use prices themselves, a statistical manipulation with moving averages, or oscillators, etc. Volume, though, is an independent variable and can therefore be extremely useful in confirming price action. There are lots of ways of using volume, such as the construction of oscillators, on balance volume lines, and the design of indicators using both volume and price. Some of these more sophisticated variations will be discussed in future articles. In this one, though, I am going to concentrate on the basics. First, it is important to understand there is always a perfect balance between buyers and sellers because the amount of a security sold is always identical to that which is purchased. What moves pieces is the relative enthusiasm of buyers or sellers. If sellers are more motivated than buyers the price will decline and vice versa. Volume is usually displayed in charts as a series of histograms underneath the price. This is a useful form of presentation since it reflects expansions and contractions in activity. There are several key principles used in interpreting volume. However, before I cover this aspect, it is important to understand that when I talk about changes in the level of volume I am referring to volume changes relative to the recent past. For example, it's not possible to compare the volume on the NYSE today when it's in the hundreds of millions with the volume at the start of the century when it was less than one million. This is because there are now far more shares listed. Activity has also grown because of futures and options arbitrage, and reduced commission charges allow more frequent trading. But you can compare high volume this week with volume two weeks ago. The following represents a brief synopsis of some of the basic principles of volume interpretation: 1. Volume should go with the trend When prices are rising it is normal for volume to expand, and when prices are declining volume typically contracts as in Figure 1. Figure 2 reveals that when we talk of rising or contracting volume, we mean the overall trendof volume, not individual sessions. The green arrows mark the trend, which is an expanding one. Within that trend, though, there are individual sessions, such the two flagged by the red arrows, where volume is below the surrounding days. When prices are rising and volume is expanding market action is not telling us much, except to say that this is a normal state of affairs and that the up trend is soundly based. However, when prices rise, as in Chart 1, featuring the Mexico Fund, and the trend of volume is down, it is abnormal and warns us that rising prices are being fueled more by a lack of selling than the enthusiasm of new and aggressive buyers. Most of the time you will find bear market rallies being associated with a trend of declining volume, such as that shown in Figure 3, where volume contracts as the short-term bear market rally develops. Just as falling volume and rising prices are abnormal, so are declining prices and expanding volume. In a healthy market, prices and volume contract together, more because of a lack of buying than a preponderance of selling. However, when prices decline and volume expands, it tells us that downside pressure is present because sellers are very aggressive and this is not a good portent for future prices. In this regard, Chart 2 featuring Nucor, shows how volume starts to pick up as the price starts to decline. This is a very subtle sign, but a very important one nonetheless because it tells us that sellers are getting anxious. Since prices are declining it also informs us that buyers are not enthusiastic enough to pick up the slack. Quite often you will see the situation where, following a rally, prices start to slip. However, on the first or second day that this starts to happen, volume picks up noticeably. This is abnormal and again flags a danger signal since it indicates that prices are falling due to the urgency of sellers rather than falling of their own weight due to a lack of buyers. 2. Volume leads price during rallies It is normal for a peak in prices to be preceded by a peak in volume. In Figure 4 you can see that the volume peaks at A but the price tops out at C. The level of volume at C is less than that at A and B. At point B, a negative divergence between price and volume developed as prices moved higher and the peak in volume moved lower. This type of action tells us that prices are no longer being supported by an influx of enthusiastic buyers and that the prevailing trend is suspect. Chart 3 of IBM, displays two interpretive principles. First, we see the concept of volume leading price. Secondly, note how volume expands noticeably on the first two days of the decline. This, as discussed above, is abnormal because volume is not going with the trend, and is therefore a bearish sign. Article printed with permission. For more information on Martin Pring please visit Pring Research - Technical Analysis, Educational CDs, Financial Newsletters and Charting Tools.

Video on a trade setup using basic VSA and market profile concepts. Once again, I would like to emphasize how I use market profile concept to create a directional bias and using technical setups to find entry points. CLICK HERE TO VIEW VIDEO Further explanation can be found here.

We are in talks on having a online webinar with TradeGuider | Trading Software | Investment Software | Volume Indicators on Volume Spread Analysis. Gavin from TradeGuider will be hosting a live presentation exclusively for Traders Laboratory. This will be held on March 13 (if not, the one after). More details will be provided by March 12, so please read this thread for further announcements. Thanks

I was reading an article on spread analysis today and there are some points I have yet to comprehend completely. The article focused on using the spread as a leading indicator to sense bullishness or bearishness in the futures market. The futures market is classified into 3 groups of market participants: noncommercial, commercial, and nonreportable. As an intraday trader, we need to follow the footsteps of these noncommercial traders as they reported to make up approx 80% of the total volume. Noncommercial traders are referred to as the big boys or the large speculators in the markets. The question I have is regarding the activity by these noncommercial traders to push the nearby contract in relation to the deferred contract. The article mentions when the spread is narrow, noncommercial traders hold a neutral to bearish outlook while a wider spread would indicate a bearish outlook. Can anyone explain this concept to me? Why would traders trade the future contract and not the current? How can one apply spread analysis to their trading? Thanks